Part 9: The former Soviet Republics of the Disunited States of Authoritarian Chaos

A global network of Jihadists fueled by petro-dollars, charities, and a fanatical zeal expanding their reach around the world: pretty scary stuff, huh? Scary and current news at that! Except stuff like this is not new news, and Russia is no exception. While the Soviet Union’s military might may no longer be directly aimed at taking down the Free World, the current situation is arguably much worse. It’s a situation involving organized criminal elements that are increasingly adept at infiltrating the new globalized economy, and a vast, unwieldy, and an exceedingly deadly military-industrial complex scattered across the former Soviet Republics.

September 11, 2001 shattered the global geo-political equilibrium, but it wasn’t the only event to do that in recent years. It was just the loudest. What is often forgotten in the US is that over two years before America’s traumatic day of terror, Russia experienced a wave of terror that catalyzed the fall of the Wild West (and pro-Western) years of Boris Yeltsin and his band of Oligarchs, and catapulted a new, largely unknown ex-Spy into the Presidency. That “ex”-Spy, Vladimir Putin, has charted a new course for Russia, away from Yeltsin’s drunken embrace of a quasi-western-style democracy and klepto-capitalism and into a new authoritarian Russia with fewer freedoms, more petro-wealth, and an expanded War on Terror.

Russia’s War on Terror is another one of those endless wars, filled with contradictions in allies, vague goals of “security”, conflicts of interest, and plenty of down right horrors. It’s also intertwined with the US’s War on Terror in a number of ways beyond the direct military, financial, and ideological links between the Jihadists in Central Asia and the Middle East. Frighteningly, upon closer examination, the very military-industrial complex which has become a bedrock of the Russian and former soviet economies (weapons manufacturers, arms traffickers, and now global organized crime), has kept its wild-west characteristics and continues to supply the darkest groups and regimes around the globe (including al-Qaeda) with everything from logistical support, to small arms, and possibly nuclear weapons.

And, of course, there is Saudi money and the Muslim Brotherhood. Let’s start off our look at this most unpleasant situation with an excellent 2003 Washington Post article on how Jihad came to Chechnya:

How Jihad Made Its Way to Chechnya
Secular Separatist Movement Transformed by Militant Vanguard

By Sharon LaFraniere
Washington Post Foreign Service
Saturday, April 26, 2003; Page A01

KARAMAKHI, Dagestan -- This isolated southwest Russian village of dirt roads and one-story clay brick houses was profoundly peaceful, its residents say, until a Jordanian cleric named Khabib Abdurrakhman arrived in the early 1990s with a seemingly irresistible deal.

To a hamlet made destitute by the collapse of the Soviet Union, Abdurrakhman brought a slaughtered cow and a free feast every week. In a place where many people were left jobless by the demise of the local collective farm, he handed out $30 to every convert who came to his simple mosque. And to those adrift in the social chaos of the Soviet breakdown, he offered a new purpose in life -- a form of their traditional Islam rooted in fundamentalism and militancy.

Few questioned where his money came from, or who were the other Arabs who began to drift into the community. By the time questions did arise, it was too late.

By 1999, Abdurrakhman's growing band of followers had transformed the little settlement into an armed enclave, crisscrossed by tunnels and trenches and stockpiled with weapons for Abdurrakhman's true mission: severing Dagestan from Russian control and merging it into an Islamic state with neighboring Chechnya.

They tried to lure people in a friendly way at first," according to Magomed Makhdiyev, the village imam, who says he tried to withstand the fundamentalists' influence. "But by 1999, they were saying, 'Join us or we'll cut your head off.' "

The transition from “friendly” fundamentalists to ones threatening decapitation took place long before 1999. Following the withdrawal of Russian troops from Chechnya in 1996 a sharp rise in Islamists activity involving Wahhabiist foreign fighters and veterans of the Afghan conflict spread across the region. In May 1997 Wahhabi militants fought with representatives of local Sufi brotherhoods in Dagestan. On December 21, 1997, Dagestan was also the location of the assassination of several dozen Russian soldiers and officers by three units of former central Asian “Afghan” volunteers, harkening from Chechnya, Daestan, Ingushetia, Uzbekistan, and Kyrgyzstan. Before returning to Chechnya they set fire to three hundred vehicles and passed out leaflets proclaiming that new military training camps were to be opened in Chechnya to “teach the impious Russians a lesson”. In December 1997 several police officers were slain in Uzbekistan, which the notoriously authoritarian government blamed on central Asians trained in Afghan and Pakistani camps. In early 1998 Wahhabist operating out of Chechnya kidnapped UN refugee officials and held them for 317 days of UN officials by Wahhabiists in Chechya, and on July 15, 1998 fighting between around one thousand Islamic fighters and security forces killed 50 people in the Chechen town of Gudermes. In August of 1998, three Dagestani villages’ Wahhabi communities declared themselves “independent Islamic republics”, recognized Sharia as the only law, and sought to join Chechnya. 1998 also saw Kyrgystan engage a massive public campaign to counter Saudis promoting Wahhabism (1).


Abdurrakhman was part of a militant vanguard that deeply influenced what was then a secular separatist movement in Chechnya, recasting it in part as an international jihad that spilled over from the republic to neighboring Dagestan. Today the Russian government insists that it is impossible to understand the Chechen conflict without understanding the role of people like Abdurrakhman.

Russian intelligence officials say he is just one of hundreds of Arab radicals whose fervor and funds fueled fighting that has cost the lives of more than 4,500 Russian soldiers and thousands of rebels, plus many civilians, over the past 31/2 years.

Interviews with Chechen exiles, villagers in Chechnya and Dagestan, Western diplomats and terrorism experts confirm that Arab militants have played a significant role in the conflict. The full story has yet to emerge, however. Arab and Chechen commanders waging war in the republic are in hiding and could not be interviewed.

In the Russian government's view, Chechnya's war is nothing more or less than a terrorist enterprise, paid for by a combination of al Qaeda money and fraudulent charitable donations, commanded by Arabs trained in Afghanistan and fomented by outsider clerics such as Abdurrakhman preaching armed revolution under the theological justification of an Islamic strain known as Wahhabism.

"There are no more al Qaeda camps" in Chechnya, Russian President Vladimir Putin said in February. "But there is still al Qaeda money. . . . There are instructors who are working, there are mercenaries from a number of Muslim countries recruited by radicals. Unfortunately, all that still exists there."

On top of the apparent al-Qaeda support in Chechnya, there also still exists the Russian troop presence, with Putin calling for a gradual draw down of troops in August of 2006.


A Change of View

Until the Sept. 11, 2001, terrorist attacks in the United States, the Russian argument got little hearing in the West, where officials suspected that Russia was mainly trying to deflect criticism of human rights abuses by Russian troops.

But in recent months, U.S. officials have increasingly subscribed to the Russian view that Arab militants have helped Chechen rebels with money and weapons, although the Americans say the guerrilla war still has its roots in Chechens' decades-old resentment of Soviet, and later Russian, dominance.

"Obviously there is still a strong internal impulse behind the Chechen insurgency," said a senior U.S. diplomat. "But it has become commingled with the broader international agenda of the Arab fighters."

The two foreign fighters we’re going to look at in this article, Abu Walid and Ibn Khattab, are prominent examples of the kinds of figures that led the drive to infuse nationalist sentiment with Jihadist goals.


Bush administration officials say the United States has helped cut off outside support of the conflict by routing the Taliban in Afghanistan, helping drive Islamic fighters from the nearby Fergana Valley in Uzbekistan and forcing Georgia to police the Pankisi Gorge on the Chechen border. After denying for years that the valley was a rebel sanctuary, Georgian officials now say that until last summer, it was home to 800 rebels, including 80 to 100 Arabs in a unit that received funds from al Qaeda.

A few interesting side-notes regarding Uzbekistan and militant Islam: With more than 80% of its population Muslim, Uzbekistan has a long history with Islam and militant Islamists and the modern day is no exception. Nor is it much of a surprise given the horrific nature of Uzbekistan’s President. One of the first al-Qaeda allies killed in the post-9/11 fighting in Afghanistan was Juma Namangani, the leader of the Islamic Movement of Uzbekistan (IMU), a close ally of the Taliban. Juma got his name from the the Uzbek town of Namangan (his real name is Jumaboi Khojiev), on the edge of the Fergana Valley which is a hotbed for militant Islam and a major waypoint for the Central-Asian-to-Europe drug trade. In another example of the fusion between organized crime, drugs, and terrorism, Jama Namangani turned to the massive drug trade through the Fergana Valley to finance his Jihad, a practice the IMU continues today.

The second major Islamist group operating in the predominantly-Muslim Uzbekistan is Hizb ut-Tahrir, a Muslim Brotherhood offshoot that advocates a global Islamic Caliphate. Although it professes to be a non-violent group (which been disputed), Hizb ut-Tahrir has been banned by countries across the globe, including Germany, where it was outlawed in early 2003 following an Hizb ut-Tahiri event that was attended by members of the NPD, the German neo-Nazi party. And who was at this meeting? Why none other than NPD lawyer Horst Mahler.

And speaking of Nazis, it is worth noting that Russia has had an alarming increase in neo-Nazi, racist, and anti-immigrant activity in recent years, and that includes President Putin’s actions.


Some terrorism experts say the West erred by dismissing Russia's claims for so long.

"Chechnya and the Pankisi Gorge in Georgia partially replaced Afghanistan as a center for terrorist training," said Rohan Gunaratna, a terrorism expert and the author of "Inside Al Qaeda." "The initial wave of terrorists who are now coming to Europe trained in Chechnya or Algeria," he said.

Col. Ilya Shabalkin, a spokesman for Russian forces in Chechnya, said Arabs still make up about one-fifth of Chechnya's roughly 1,000 active armed militants, who are increasingly confined to the republic's forests and mountains. "The Arabs are the specialists, they are the experts in mines and communications," Shabalkin said. He identified their leader as Abu Walid, a Saudi who showed up in Chechnya in the late 1990s.

Abu Walid, who was killed in April 2004, was also the accused mastermind of a February 2004 Moscow subway bombing. He’s also reportedly a member of the Muslim Brotherhood, making him an example of the larger pattern we’ve been examining: Muslim Brotherhood affilliated militants, often in league with Saudi clerics promoting Wahhabism, promoting their style of Islam among the native peoples while simultaneously providing access to guerrilla warfare training, and weapons. In cases like Mr. Walid’s Arab “specialists”, this dynamic duo of jihad can even supply veteran soldiers whose valuable skills not easily found elsewhere.


The money, Russians say, comes from known terrorist groups such as al Qaeda and from some 40 organizations masquerading as charities in the Middle East, Europe and elsewhere. The flow of funds has diminished since U.S. and Russian intelligence began jointly clamping down on terrorist financing after the Sept. 11 attacks. Even so, the Russians say, $500,000 to $1 million a month still reaches Chechnya, delivered in small sums by couriers who travel Georgia's rugged mountain paths.

In 2004 the US-Russia Counter-Terrorism Working Group pledged to explore the establishment of a regional body to combat terrorist financing and money-laundering in Central Asia. Also starting in 2004, and continuing on into 2005, a number of US banks cut off ties to Russian banks over a banking crisis and lax money-laundering laws. In September of 2006, Russia’s top central banker, who had been leading the charge on cleaning up money-laundering, was assassinated. Yep, things have been going really well on the Russian anti-money-laundering/terror financing front since 9/11.


One source is a Saudi charity, al Haramain, according to Russia's Federal Security Service. In an internal memo provided by the agency, the FSB accused the charity of wiring $1 million to Chechen rebels in 1999 and of arranging to buy 500 heavy weapons for them from Taliban units.

The memo quotes what it calls messages exchanged between Arab commanders in Chechnya and al Haramain's director in Saudi Arabia. "Today, al Haramain has $50 million for the needs of the mujaheddin," one message from the charity read.

"The reason al Haramain provides assistance a little bit at a time is because it is afraid of the accusations it is assisting the jihad," said another.

Russia forced al Haramain to close its offices in Georgia and neighboring Azerbaijan in 2001, but its workers dispersed to similar groups that continue to work freely in Azerbaijan, Sergei Ignatchenko, the FSB spokesman, said in an interview.

A year ago, the United States and Saudi Arabia shut down al Haramain branches in Somalia and Bosnia after U.S. officials asserted those offices used charitable donations to finance terrorist activities.

Al Haramain says it distributed blankets, clothing and food in Chechnya but stopped its work there 14 months ago. "We do not have any relationship with any terrorist activities," said Shaykh Aqeel Aqeel, the charity's director. "We work under the supervision of the Saudi government."

Al-Haramain can’t quite claim to work under the supervision of the Saudi government anymore, since the Saudis shut it down in 2004 following the attacks on a Western residential compound in Riyadh that was preceded by over a year of terrorist attacks within Saudi Arabia. The shutdown of Al-Haramain had been a priority for both the Clinton and Bush administrations. In 1997 Al-Haramain employees were expelled from Kenya over evidence that it was involved in planning to bomb the US embassy in Nairobi , which took place the following year. Mercy International, which was headed by Bank al-Taqwa’s Kaldoun Dia Eddine, was expelled from Kenya altogether in 1997 over these fears (2).


Money From Bin Laden

Russian intelligence officials assert that Osama bin Laden donated at least $25 million and dispatched numerous fighters to Chechnya, including Ibn Khattab, a Saudi who led one of the best-trained contingents. The United States now agrees that Khattab had al Qaeda ties, and cited those links when it added three Chechen rebel units to its list of terrorist organizations earlier this year.

Both Al-Haramain and Ibn Khattab had long roles in the Chechen conflicts. A veteran of the Afghan war, Ibn Khattab arrived in Chechnya in 1995 during the initial 1994-1996 war. He also appears to have close connections with the Muslim Brotherhood. Al-Haramain, which was set up to support the Afghan Mujaheddin and spread Wahhabism, is said to have been one of the main charities that funneled support to Khattab’s military efforts during this early period (3).


American officials said that several hundred Chechen fighters were trained at al Qaeda camps in Afghanistan and that bin Laden sent "substantial amounts of money" to equip Chechen rebels in 1999. Some reports suggest al Qaeda urgently requested that Islamic organizations in Kuwait provide $2 million to the Chechen fighters as recently as last May, the U.S. government said in a five-page explanation of its decision to add Chechen groups to the list.

Gunaratna, the author, said Russia is exaggerating al Qaeda's contribution but not bin Laden's interest in the Chechen rebel cause. According to Gunaratna, the terrorist leader used a Persian Gulf bank to help finance the militants, at one point ordering an investigation into whether some Chechen leaders had siphoned off funds for themselves.

U.S. officials said they uncovered one source of support for Chechen rebels close to home: a Chicago-based charity called the Benevolence International Foundation, which investigators said funneled $300,000 to rebels in Chechnya and Bosnia. The foundation's director, Enaam Arnaout, denied any connections with al Qaeda.

But U.S. investigators said they found handwritten correspondence to and from bin Laden in the group's office in Bosnia. In one letter, according to court records, bin Laden declared: "The time has come for an attack on Russia."

Oh look, what a surprise: Our friends from the al-Qaeda-linked/Saudi-funded Benevolence International Foundation, which we just looked at in the last essay, were apparently funneling money to Chechnya too! They were busy bees indeed.

A note regarding Mr Arnaut’s denials: as part of Enaam Arnauot’s plea deal he admitted to defrauding donors to Benevolence International by diverting almost $316,000 to fighters in Bosnia and Chechnya. In return for the plea deal, prosecutor Patrick Fitzgerald dropped the terrorism charges, Arnaout was sentenced to 11 years in prison, and thus ended the only US terrorism charge brought against a top official of a Saudi charity.


Ayman Zawahiri, who is the United States' most-wanted terror fugitive after bin Laden, also saw potential in Chechnya as a sanctuary for his Egyptian militant followers before he merged his organization with al Qaeda in early 1998, Russian officials have said. Zawahiri's plans for Chechnya fell apart after Russian authorities arrested him in Dagestan in 1997, jailed him for six months and then freed him before learning his true identity, according to FSB spokesman Ignatchenko.

Zawahiri wasn’t captured alone in Dagestan. Zawahiri and two of his top Lieutenants, were picked up by Russian authorities soon after crossing the border into Dagestan. They claimed to be working for a trading company that dealt with leather and medicines. Two Egyptian Islamic Jihad representatives arrived in Dagestan to meet with them, and soon after their arrival guards found $3,000 in their cell. Russian security services also overheard telephone discussion of a bribe offer, and investigators reportedly suspect the three were terrorist “big fish”(4). Given their long roles in Islamist extemist movements, including Zawahiri working closely with Osama bin Laden in the fight against the Soviets in Afghanistan, and the fact that Islamists were flowing into Chechnya after a brutal war with Russia, the apparent misidentification of Zawahiri and his colleagues by Russia’s justice system raises some interesting questions.


Arab influence in the first war between Chechen separatists and Russian soldiers, from 1994 to 1996, was minimal. Independence-minded Chechens considered themselves able to handle their own affairs, said Shamil Beno, who served as Chechnya's foreign minister in 1992 and as the republic's representative in Moscow in 2000-2001.

Dzhokhar Dudayev, Chechnya's president from 1991 until his death in 1996, was afraid of terrorist funds, Beno said in an interview: "He wanted checks done to see if it was terrorist money or not."

Those scruples faded in the mid-1990s, as more and more Arab missionaries and fighters flocked to the republic, proclaiming Islamic law, or sharia, and promoting Wahhabist traditions. Warlords had come to dominate Chechen society, and some of them embraced the fundamentalist cause.

The Arabs' goal went beyond preserving Chechnya's freedom: They wanted to merge Chechnya and Dagestan to create an Islamic state. Chechnya and Dagestan were poorer than the rest of Russia, and Dagestan, though home to a mosaic of ethnic groups, was predominantly Muslim. Its access to the Caspian Sea and its oil and gas reserves gave it a strategic importance to Russia that Chechnya did not share.

One of the new leaders was Khattab, who fought with bin Laden in Afghanistan as a teenager and who had publicly praised the al Qaeda leader as the "main commander of the mujaheddin worldwide." Khattab's position in the rebel movement was assured when he won over Shamil Basayev, Chechnya's best-known militant.

Shamil Basayev became so well known, and feared, in Russia that he could be characterized as Russia’s Osama bin Laden (although he became heavily feared in Russia before bin Laden was in the US, so maybe Osama is the US’s Basayev). One interesting similarity between the two is that they both based their media spokesmen in London. One big difference between the two is that Basayev is dead and Osama is, ummm…they’re still working on that part.

And finishing our look at this article…

Planning a Takeover

Beno, who was once Basayev's close friend, said Basayev changed after he met Khattab in 1995. "He started moving from freedom for Chechnya to freedom for the whole Arab world. He changed from a Chechen patriot into an Islamic globalist," Beno said.

Basayev has told reporters he visited training camps in Afghanistan three times in the early 1990s to study the tactics of guerrilla warfare. In Chechnya, he and Khattab built their own training camp in the village of Serzhen-Yurt, complete with advanced communications equipment.

Their plans to take over Dagestan revolved partly around the village of Karamakhi, where Abdurrakhman, the Jordanian cleric, had begun preparing for jihad years earlier. By mid-1999, the village had been turned into a fortified base for rebels and religious fundamentalists.

Residents recall the sign that stood on the dirt road that led off the main highway: "This territory is under the jurisdiction of sharia law." A green Muslim flag was posted on a hill.

In August 1999, Chechen rebels launched incursions into Dagestan, but the operation failed miserably. Within a few weeks, Russian troops had driven hundreds of rebels under Khattab and Basayev back across the border into Chechnya. Russian troops announced the capture of Karamakhi in September.

That month, Moscow apartment houses were hit by a series of bombings that killed close to 300 people and were blamed by Russian authorities on Chechen rebels. Russian warplanes began hitting their positions and by October, 80,000 Russian troops were marching into Chechnya to reclaim the republic. Khattab was killed by Russian troops last year.

So in a less than a decade the nationalist separatist movement of Chechnya was hijacked and turned into another front in a global Jihad, culminating into a series of deadly apartment blasts in 1999 that were the start of Russia’s own War on Terror. But it’s the third of those bombings, a failed attempt on 9/22/99 that began to raise questions as to whether or not Russia’s relationship with radical Islamist terror suffers from some dark complications.

The Ryazan mystery

The series of bombings in Moscow in the Autumn of 1999 were more than just the catalysts for a Russian reinvasion of Chechnya. They were a rallying cry for Boris Yeltsin’s teetering, scandal plagued government, that ushered in the age of Vladimir Putin. And they were also a source of much speculation that the bombings weren’t carried out by Chechen-linked Islamists and the weren’t intended to plan a takeover so much as to maintain one. Let’s take a closer look at this mystery with an excellent 2002 article in the National Review:

April 30, 2002, 8:45 a.m.

The Shadow of Ryazan

Is Putin’s government legitimate?

By David Satter

For the last two and a half years, a specter has haunted the government of Vladimir Putin. This is the possibility of a serious examination of the strange apartment-house bombings that took place in September, 1999 in Moscow, Buinaksk, and Volgodonsk and cost 300 lives.

The bombings terrorized Russia. The Russian authorities immediately accused Chechen rebels of responsibility for the attacks and this galvanized public opinion in support of a second war in Chechnya. The war, in turn, made Putin, the former head of the Federal Security Bureau (FSB), an overnight hero and the leading candidate for the Russian presidency.

Vladimir Putin was made Russia’s Prime Minister just a month before the bombings following the Chechen invasion of Dagestan. He was the 4th Prime Minister in less than two years for a Yeltsin administration mired in a deep political and economic crisis.


Almost from the start, however, there were doubts about the timing of the bombings that could not have been better calculated to rescue the political fortunes of the ruling, Yeltsin-era oligarchy. Suspicions only deepened when a fifth bomb was discovered in the basement of a building in Ryazan and those responsible for placing it turned out to be agents of the Federal Security Bureau (FSB).

The suspicions around the Ryazan bombings literally started that evening amongst the local police who found explosives in an apartment building. The police also apprehended FSB agents in town that same night. They were forced to release the FSB agents and watch the Kremlin authorities announce that this was all part of a training excercise.

In 2003, one of Russia’s leading Human Right advocates turned parliament member, Sergei Kovalyov, began an investigation into possible FSB involvement. Later that year, Mikhail Trepashkin, a former FSB lieutenant colonel who voiced early doubts on this matter and was a member Mr Kovalyov’s commission, was arrested and charged with being a British MI5 agent out to help a misinformation campaign and sentenced to four years in prison.

In some tangentially related news, one of Russia’s leading investigative journalists on the Chechen conflict, Anna Politovskaya, was killed in October of 2006. Also, Paul Klebnikov, the editor “Forbes Russia” and expert of the dark side of Russian finance, was gunned down in July of 2004. While there were many possible suspects, including Russian oligarch Boris Berezovsky, Russian investigators concluded the killings were order by a Chechen militant. Doubts about that conclusion persist. In 2006 the two accused Chechen gunmen were acquitted by a Moscow jury.

In even more tangentially related news, Colombia’s military was rocked by a series of scandals in 2006, including allegations that Colombian intelligence agents hired ex-guerillas to carry out fake kidnappings and staged bombings.


Until recently, attempts to call attention to some of the paradoxes surrounding the bombings, one of the most pivotal events in post-communist Russian history, proceeded sporadically and were easily mastered by the information apparatus of the state.

On March 5, however, Boris Berezovsky, a self-exiled oligarch and former key Kremlin adviser, held a press conference in London in which he accused the FSB of carrying out the bombings with Putin's complicity in order to justify a second Chechen war. He presented as evidence the testimony of Nikita Chekulin, a former acting director of the Russian Explosives Conversion Center, a scientific research institute under the Ministry of Education, who was recruited by the FSB as a secret agent. Chekulin stated, and confirmed with documents, that in 1999-2000, a large quantity of hexogen, the explosive that is believed to have been used in the apartment bombings, was purchased by the institute from various military units and then, under the guise of gunpowder or dynamite, shipped all over the country to unknown destinations. Berezovsky also presented a documentary film that was largely based on a previous television program about the Ryazan incident that was shown on NTV and the reporting in Novaya Gazeta.

In fact, the press conference did not offer much that was new. Nonetheless, it was significant because it renewed discussion of an issue that had never really gone away. At the same time as the press conference was being held, a pamphlet novel by Alexander Prokhanov, a Russian nationalist leader, entitled "Mr. Hexogen," was enjoying a wide circulation in Russia. The novel, based on information from sources in the intelligence agencies, describes a conspiracy to unleash the Second Chechen War and use it to elect a successor who would protect the interests of the corrupt Yeltsin "family."

In explaining his support for the American-led antiterrorist coalition after Sept. 11, 2001, Putin said that Russia had also been a victim of terrorism. This experience, however, looks rather different if the bombings in September, 1999 were carried out by the Russian government as part of an effort to preserve the power and wealth of a criminal oligarchy.

The view that the bombings were the work of the Russian government is based on three types of evidence: the logic of the political situation at the time of the attacks; what is known about the bombings in Moscow, Buinaksk and Volgodonsk; and the implications of the so called "training exercise" in Ryazan. Unfortunately, in all three cases, the weight of the evidence supports the view that the bombings were not the work of Chechen terrorists but rather the action of the Russian government undertaken to justify the launching of the Second Chechen War.

In August, 1999, on the eve of the bombings, it appeared that the Yeltsin "family" and the rest of the corrupt oligarchy that ruled Russia was facing an unavoidable day of reckoning. As the economic situation in Russia got steadily worse, Yeltsin's approval rating dropped to two percent and an uneasy awareness spread among the persons closely connected to the Yeltsin regime that their positions, their wealth, and possibly their freedom and even their lives were in jeopardy.

The fact that Vladamir Putin was the head of the FSB just before being made Prime Minister a month before the bombings adds to the speculation that he may have known or approved of a plan to terrorize the civilian populace for political ends. And if that was the case, the plan worked. When Yeltsin nominated Putin to be Prime Minister in August of 1999, he also called for new Parliamentary elections in December of 1999 and declared Putin to be his intended successor to the Presidency in 2000. The December parliamentary elections were seen as a public referendum on the Yeltsin regime, and, surprise surprise, following the Moscow terrorist bombings and the Putin-led new military campaign in Chechnya, the pro-Kremlinist parties of Yeltsin and Putin won big at the expense the Yeltsin’s political enemies, most notably the Communist who had dominated the Duma since the fall of the Soviet Union.


In August, 1998, Russia experienced a devastating financial crisis and, in its wake, Yeltsin was forced to compromise with the Duma and accept as prime minister, Yevgeny Primakov, the foreign minister and former head of the Foreign Intelligence Service. Primakov authorized a series of investigations that affected the members of the "family" themselves.

One investigation involved Berezovsky, who, in January, 1999, was suspected of appropriating money belonging to the airline, Aeroflot. More important for the "family," however, was the investigation into possible kickbacks to Pavel Borodin, the head of the property administration in the presidential administration, from the Swiss firm, Mabetex, in connection with construction and repair work on the Kremlin. On January 22, 1999, the Mabetex office was raided in Lugano and records were discovered that showed payments of $600,000 on the credit cards of Yeltsin's daughters, Tatyana Dyachenko and Yelena Okulova.

The Russian financial crises of 1998 may have been the beginning of the end of the Yeltsin’s rule, weakening him to the point of needing to compromise with the anti-Yeltsin Communists in the Duma and choose of Yevgeny Primakov for Prime Minister in the fall of 1998. Catalyzed by the Moody’s rating agency downgrading Russia’s debt, the collapse of the ruble happened just a month earlier and came in spite of the approval of IMF loans intended to stabilize Russia’s ailing currency and keep it on the Western-backed reformist path. It was a death blow for a Russian economy that, in early 1998, seemed to be emerging from years of shocking collapse and stagnation. It was also following in the wake of the 1997 Asian Financial Crisis, a part of a pattern of boom-bust financial crisis that has been a characteristic of the hot-monied, deregulated economies in the post-Cold War world. Money-laundering and tax-evasion haven’t been the only unfortunate financial side-effects of this age’s particular brand of globalization.

By September of 1999, during the exact same period as the Moscow terrorist bombings, Yeltsin was facing charges that the Yeltsin “family” had been involved in laundering the billions of dollars in IMF loans through the Bank of New York that was meant for shoring up the collapsing ruble. This was in addition to Mabetex kickbacks scandal of alleged political payoffs to the Yeltsin “family” by the Swiss construction Mabetex in exchange for lucrative Kremlin construction contracts. The scandal was centered around Pavel Borodin, a close Yeltsin aide who happened to be Putin’s mentor. The Swiss firm, Mabetex, is own by Behgjet Pacolli, a wealthy Kosovar Albanian. The kickback funds were allegedly moved accounts with Banca del Gottardo (which, we’ll recall, was Bank al-Taqwa’s bank). Laundering also involved a shop in Lugano, Switzerland that was owned by the wife of the Banca del Gottardo official handling the Russian accounts (Banca del Gottardo is a full service bank, you see). The Mabetex corruption scandal isn’t the only one that involves Mr Pacolli and Banca del Gottardo. According to investigative journalist Lucy Komisar, Mr Pacolli may have been using Banca del Gottardo to transfer Russian biological weapons to Islamist terrorist groups, although the charges are denied.

There was no shortage of speculation that the multiple money-laundering scandals were an attempt to take down the Yeltsin regime. And there was even more speculation as to who was behind the leaks. Regardless of who it may have been, it worked to the extent that Yeltsin resigned early, although doing so likely helped Putin in the April 2000 Presidential elections.

Still, Putin’s reign has not been a steady continuation of the Yeltsin years. Under Putin, Russia began to chart a very different course than the one it had been on. It’s been a course towards authoritarianism and away from the Yeltsin-years’ haphazard, often shocking, lurch into democracy.


The threat to some of the country's most powerful figures prompted a response. Yuri Skuratov, the prosecutor general who was leading the investigations, was removed after a video of him engaged in "sex acts" with two prostitutes in a sauna linked to a Moscow criminal organization was shown on primetime television. The cases involving Berezovsky and Mabetex, however, were not forgotten.

Dissatisfaction with Yeltsin was spreading and, in May, 1999, Yeltsin fired Primakov and his government and installed as acting premier, the interior minister, Sergei Stepashin. A move to impeach Yeltsin for, among other things, illegally suppressing the Supreme Soviet in 1993 and launching the war in Chechnya in 1994, was narrowly defeated with the help of the distribution of bribes to wavering deputies. But the Fatherland-All Russia movement that was organized by Yuri Luzhkov, the mayor of Moscow, was gaining strength. On August 23, Luzhkov promised that if Primakov, the most popular politician in the country, was to run for president, he would support him.

The prospect of Primakov as president was frightening for the Yeltsin entourage because he had already demonstrated his readiness to pursue corruption cases and, as Skuratov was later to state, it was possible to bring criminal cases against every one of the oligarchs of the Yeltsin era.

One thing that hasn’t changed during the Putin era is the endemic the kleptocracy, at least when it comes to organized crime and corruption. The fall of the Russian oligarchs, though, was a major change (and if you want to see how a well-connected individual could loot systematically take control of a country’s wealth after the fall of the Soviet Union, take a look at Victor Kozeny, the “Pirate of Prague”). The cadre of oligarch’s that accumulated the bulk of Russia’s wealth during Yeltsin’s reign have come under assault from the Putin regime and it’s a purge that continues today and has resulted in increasing state control of Russia’s industries, especially the massive oil and gas industry. As Russia’s recent cut-off of natural gas supplies to the Ukraine and Eastern Europe has demostrated, the Kremlin’s consolidation of power over Russia’s massive petroleum industries is a potent weapon with global implications.

And finishing off our look at David Satter’s National Review article…

By the summer of 1999, there was reported to be an atmosphere of near panic in the Kremlin and there were reports that the Yeltsin "family" was planning provocations in Moscow, including acts of terror, in order to discredit Luzhkov. One such report, by Alexander Zhilin, which appeared July 22 in Moskovskaya Pravda said that there was a plan to destabilize the atmosphere in Moscow by organizing terrorist acts, kidnappings and a war between criminal clans. The plan, known among insiders as "Storm in Moscow," was never implemented, possibly because an even more effective plan took its place.

On August 5, a Muslim force led by Shamil Basayev, a Chechen guerilla leader, entered western Dagestan from Chechnya, ostensibly to start an anti-Russian uprising. On August 9, Stepashin was dismissed and Putin became prime minister. On August 22, the force withdrew back into Chechnya without heavy losses, amid suspicion that the incursion had been a provocation. At the end of August, Russian aircraft bombed Wahhabi villages in Dagestan in seeming retaliation for the incursion and this was followed, days later, by the explosions that obliterated the apartment buildings in Moscow, Buinaksk and Volgodonsk.

The bombings stunned Russia but, in their wake, the stage was set for the rescue of the Yeltsin-era oligarchy. Popular anger over corruption was redirected against the Chechens. Putin, whose popularity rating had been two percent, launched a war against Chechnya and, in the process, became Russia's savior. In April, 2000, he was easily elected president and, in that capacity, he granted immunity from prosecution to Yeltsin and his family, put an end to all talk of a redivision of property, and preserved the Yeltsin-era oligarchy virtually intact.

Yes, the bombings took Putin from a 2% approval rating to Russia’s savior. Whether or not these were acts carried out by the Kremlin, the Russian public’s response to the terrorist bombings and the second war in Chechnya is another example of how war and terror are potentially potent political weapons for those inclined to engage in such treachery.

War for peace…and a little profit

In addition to be potential political boons, war and terror often go hand in hand with immense profit, sometimes so much so that the war profiteers don’t want the warring parties to peacefully end the profit party. By 2003, the picture emerging from Russia’s war in Chechnya indicated that such a scenario, and worse, had been created. To get an idea of the kind of high and low level corruption taking place, let’s take a look at an excellent 2003 Time Europe article:

Profits of Doom

A Russian special ops commander says the Chechen war is really being fought for oil, arms and money


Posted Sunday, September 28, 2003; 12.48BST

Andrei Petrov (not this soldier's real name) knew he'd never have a better chance than this. It was a scorching August day in 1999 and Petrov — commander of a Russian special-ops team in Dagestan, a Russian republic bordering Chechnya — had Chechen warlord Shamil Basayev in his sights. Earlier that month, Basayev had led an invasion of Dagestan and called upon local separatists to help in the fight against Russia. With a simple squeeze of his finger, Petrov could take out Basayev, the Chechens' most effective guerrilla general and the man responsible for some of the conflict's worst terrorist attacks. But Petrov says he received the following order over his walkie-talkie: "Hold your fire."

"We just watched Basayev's long column of trucks and jeeps withdraw from Dagestan back to Chechnya under cover provided by our own attack helicopters," Petrov recalls. "We could have wiped him out then and there, but the bosses in Moscow wanted him alive. They want the war to go on indefinitely [because of] the money: millions made in oil, millions made in the arms trade, millions siphoned off from funds earmarked for reconstruction. That's why the war can never end."

Though a senior Russian Federal official dismisses Petrov's story as "improbable," other Chechnya vets have told similar tales, and in his book Forgotten Chechnya the late State Duma Deputy Yuri Shchekochikhin stated that the Basayev column was escorted out of Dagestan by Russian choppers. President Vladimir Putin, who came to power in 1999 vowing to quell the Chechen insurgency, says that the battle there is part of the global war against terrorism. But for many Moscow officials and Russian soldiers on the front lines, it has become a form of government-sanctioned organized crime.

"Extortion and looting in Chechnya are just the tip of the iceberg," says Alexei Mitrophanov, a Deputy in the State Duma, the lower house of the Russian parliament. "We're talking big money, money that's shared all the way from the top down to mere troopers." Last May, General Victor Kazantsev, Putin's envoy to the Southern Federal District that includes Chechnya, said that $6 million earmarked for Chechnya had been siphoned off by officials in Moscow. According to Usman Masayev, deputy head of the pro-Moscow Chechen administration, only 20% of $148 million earmarked to reconstruct Chechnya last year made it to the republic.

The dark reality of warfare is that the organized crime and corruption surrounding the war Chechnya are not the exception, but the rule. In September of 2006, a guns-for-drugs” ring was discovered amongst British troops in Iraq dealing with the blackmarket (and if Professor Peter Dale Scott is correct, the Chechen conflict and the global drug trade may be intertwined in some profoundly deep and important ways). In June of 2005, one of the US Army’s top military ethicists, Tom Westhusing, apparently committed suicide, although friends and family suspect foul play. Not long before his death, Westhusing had reportedly been looking into contracting practices and stumbled across some serious corruption while also voicing anguish to family members over the profit-driven nature of much of the way the reconstruction effort has been conducted (and he’s not the only high-level official tied to the Iraq reconstruction effort to commit suicide).

And finishing our look at this Time article…

The Chechen war is a deadly business, but according to confidential government reports, the Russian military estimates that 75% of Russian casualties are due to friendly fire. "Russian losses, allegedly caused by friendly fire, often result from showdowns between rival army and police forces," says Mitrophanov. They clash over the right to fleece the Chechens coming through lucrative checkpoints, or over "protection" rights for tank trucks smuggling oil across the Chechen border. Or, says Petrov, they just clash when too much vodka releases the traditional enmity between soldiers and cops. "Russian soldiers guard oil rigs that are run by the very Chechen warlords they're supposed to be fighting," Mitrophanov says. The payoff — up to $10,000 for a common riot police trooper serving a three-month-long stint — is too big to ignore for starving and ill-equipped conscripts who normally make $100 to $160 a month in Chechnya.

Other rackets popular with both the Russians and the pro-Moscow Chechen police force are kidnapping and looting. "The cops have a pattern," says Petrov. "They surround a village, and some mop it up while others loot houses, schools and mosques." The Russians also do a brisk trade as arms merchants, selling their own weapons to the Chechens. "The Chechens have state-of-the art, Russian-made weapons, including sharp shooters' rifles and automatic rifles that we don't have," Petrov says. "They even have choppers, now hidden in the mountains. Guess who sells them all that matériel."

The commanders who didn't let Petrov take out Basayev seem determined to prove him right when he agrees that a line spoken by the witches in Macbeth applies to Chechnya: "Fair is foul, and foul is fair." With unlimited supplies of guns, money and hatred — but no rules — it could hardly be any other way.

What the arms trade is all about
While the supplies of guns, money, and hatred are not unlimited, they certainly don’t appear to be in short supply these days. In part, that’s because arms sales are a massive, booming global industry, with the United States and Russia leading the world in arms sales (sometimes in sales to eachother). Nor are there any indications that the global community intends on limiting this deadly trade. In July of 2006, a US-led coalition of countries blocked UN efforts to restrict the illegal guns trade, and even if the initiative had worked it is unlikely to have made a significant impact. That’s because of figures like Victor Bout, the world’s largest arms trafficker whose clients include the US military, the UN, and just about anyone else able to pay…including al-Qaeda. Victor Bout is one of those figures that teach us the important lesson that war is a business too. Let’s take a close look at Victor Bout and chilling nature of how modern warfare is fueled with this excellent 2003 article in the New York Times (text available here):

Arms and the Man

August 17, 2003, Sunday


Late Edition - Final, Section 6, Page 28, Column 1, 7810 words

Victor Bout, by most accounts the world's largest arms trafficker, had agreed to meet me in the lounge of the Renaissance Hotel in Moscow, a monolithic post-Soviet structure populated by third-tier prostitutes and men in dark suits. Bout's older brother, Sergei, waited with me, as did Richard Chichakli, a Syrian-born naturalized American citizen who lives in Dallas. Sergei helps run Bout's many air-cargo companies. Chichakli, an accountant, calls himself a former business associate of Bout and his "friend and brother."

As we waited, Chichakli tried to discourage me from pressing Bout about his connections, suggesting that there were some things I didn't want to know. "They'll put you on your knees before they execute you," he said. Then he nodded toward the doorway. "Here he comes. Does he look like the world's largest arms dealer to you?"

Bout, who is 36, six feet tall and somewhat expansive in girth, nimbly made his way through the crowded lounge. He didn't shake my hand as much as grip it, with a firm nod. Icy blue eyes like chips of glass punctuated a baby face. We sat on one of the lounge's dingy couches, and he placed a thick folder of papers on his lap.

"Look, here is the biggest arms dealer in the world," Chichakli said, half mocking me and half mocking Bout. Bout opened his blazer. "I don't see any guns," he said with a shrug. Then Sergei raised his arms. "None here either." (Both spoke excellent English.) "Maybe I should start an arms-trafficking university and teach a course on U.N. sanctions busting," Victor Bout said. The brothers looked at each other and laughed. No one in the lounge seemed to be paying attention to Bout. Behind us sat four Israeli men who may or may not have been listening. Chichakli, who says he speaks Hebrew, said they were waiting for a phone call to confirm a deal for diamonds.

As Washington Post reporter Douglas Farah shows in his book Blood from Stones, the diamond trade is a lucrative source income for terrorist groups including al-Qaeda. This is particularly the case in Sierra Leone, where al-Qaeda, Hezbollah, Israeli diamond merchants, and a host of other players bought diamonds mined by the notoriously brutal and inhumane Revolutionary United Front (RUF) rebel force. These blackmarket blood diamonds have ended up funding some of the most brutal civil wars in Africa. They also end up in world markets, including the US markets, although there are recent moves to change that (or at least pass a law that will probably be bypassed).


Bout leaned forward. "I woke up after Sept. 11 and found I was second only to Osama." He put his hand on the papers. The truth, he said, was much bigger than his personal story. "My clients, the governments," he began. Then, "I keep my mouth shut." Later he said, "If I told you everything I'd get the red hole right here." He pointed to the middle of his forehead. The world of the arms trafficker often feels like the script of a bad Hollywood thriller come to life. At times you are tempted to laugh at the B-movie dialogue and cloak-and-dagger intrigue. But the political and financial stakes are high. And, as a Western intelligence agent in Moscow told me, this isn't celluloid, and the dangers are of a much more complicated sort.

In the summer of 1999, faced with multiple conflicts in West and Central Africa, the National Security Council authorized electronic surveillance of government and militia leaders in war zones like northeast Congo, Liberia and Sierra Leone. Every morning, N.S.C. officials cross-referenced transcripts of overheard telephone conversations with American satellite imagery and with field reports by British spies on the ground. The documentation was massive, without obvious patterns, until, finally, astute analysts noticed that every conflict had something in common: Victor Bout.

Bout’s entry into the Liberian and Sierra Leone conflicts were through his friend, and fellow arms dealer, Sanjivan Ruprah. Ruprah became part of the inner circle of Liberian president Charles Taylor in 1999 and was tasked with finding Taylor a weapons supplier(5). Taylor, in turn, was friend of RUF rebel leader Foday Sankoh. The two met in Libya in the mid-80’s where they training in guerilla warfare before launching their own wars against the governments of Liberia and Sierra Leone, which he currently faces war crimes charges over. When Ruprah was arrested in 2002 by US and European law enforcement agencies, it was hoped that it would strike a major blow against Bout’s network (and based on Bout’s continued activities, it doesn’t appear to have been ).

Another interesting business partner with Charles Taylor the somewhat controversial US Televangelist Pat Robertson.


The name surfaced in various permutations, and always in one of three contexts: airplanes, diamond transport or weapons shipments. Gayle Smith, the N.S.C.'s top Africanist, whose staff uncovered the Bout connection, sent an e-mail message to her fellow N.S.C. members: "Who is this guy? Pay close attention to this. He's all over the place." An answer was provided by a C.I.A. aviation expert from Langley, who showed up at the White House with covert photographs shot at various African jungle airstrips between 1996 and 1999. The photos, according to a former White House official who studied them, show different Antonovs and Ilyushins, Russian cargo planes built to land on (and escape from) almost any surface. In the pictures, the planes' bellies are open. African militiamen in fatigues are off-loading crates of weapons. One photo shows a younger Bout standing before one of the planes. The White House official said the planes were traced to Bout. "Bout was brilliant," Gayle Smith said recently. "Had he been dealing in legal commodities, he would have been considered one of the world's greatest businessmen. He's a fascinating but destructive character. We were trying to bring peace, and Bout was bringing war."

C.I.A. and MI6 agents on the ground in Africa first picked up Bout's scent in the early 1990's, when his fleet of planes began crisscrossing the continent. In the early days, they transported gladiolas; later, frozen chickens and then diamonds, mining equipment, Kalashnikov assault rifles, bullets, helicopter gunships and even, Bout says, U.N. peacekeepers, French soldiers and African heads of state. The names of the men Bout came to count as his personal friends and customers included Massoud, Mobutu, Savimbi, Taylor, Bemba. It was not until the summer of 2000 that the N.S.C. realized it had stumbled on not only the most prolific arms trafficking operation in Africa, the Middle East and Afghanistan but probably the best connected (and protected) private-weapons transport and brokering network in the world. Smith and others took their information to Richard C. Clarke, then the chief of counterterrorism for the N.S.C. "Get me a warrant," Clarke responded.

But because Bout's reputed crimes were committed outside United States borders, the N.S.C. had no U.S. law to use on him. Instead, the N.S.C. initiated an operation that drew on the resources of intelligence agencies in at least seven countries and sparked cabinet-level diplomacy on four continents. Belgium issued its own warrant for Bout's arrest a year later -- not for arms trafficking but for crimes related to money laundering and diamond smuggling. In the end, the pursuit failed. Victor Bout is still at large, a fugitive from international justice. But unlike Osama bin Laden and Saddam Hussein, he lives in plain sight -- in Moscow, under the apparent protection of a post-Communist system that has profited from his activities as much as he has.

Interestingly, while Bout’s reputed crimes were committed outside of US borders, his primary shipping company, Air CESS, was based in Miami.

Skipping down on the article…

Though Bout denies his involvement in arms trafficking, he has been persistently and publicly linked to weapons shipments, charges supported by paper and money trails, confessions, eyewitness accounts and multiple intelligence reports. The longer Bout has remained out of the reach of international law, the bigger his legend has grown. In many ways, he is now the public face of a giant international criminal structure. In the eight months between the time I first asked Bout for an interview and when he finally granted it, I came to understand the general shape of the political and criminal twilight that conceals the commerce of arms trafficking. In June, I laid out some of what I believed in a letter. Two days later, Bout called and asked me to come to Moscow.

When we’re learning about figures like Victor Bout, it is crucial to remember that as big as they might seem, each one is merely yet another player in a much larger clandestine industries that plays a quiet, yet significant roles in our world.


“Flowers, that's where it all started," Chichakli said. It was midnight, and we had moved on from the hotel lounge to an Italian restaurant in downtown Moscow full of people drinking vodka and eating pasta and pizza. Bout ordered a carrot juice and an arugula salad. "He's a vegetarian," Chichakli said. "He's an ecologist. He believes in saving the rain forest." Bout nodded. "I've been given a chance to reinvent myself." It was not immediately clear why he had chosen to see me. He seemed intrigued by his legend, yet wanted simultaneously to fan it and diminish it.

Over the previous 10 years, he explained, whenever he accompanied one of his planes into the remote jungles of Africa, he spent time photographing wildlife and studying isolated African tribes. "In the middle of nowhere, you feel alive, you feel part of nature." His favorite authors, he told me, were the New Age novelists Paulo Coelho and Carlos Castaneda. "What I really want to do now is to take one of my helicopters to the Russian Arctic north and make wildlife films for National Geographic and the Discovery channel." When Chichakli leaned forward, I noticed that the label on his tie said "Unicef." He gestured toward Bout. "He gives Unicef money." We all laughed; I suspect for different reasons.

Victor Bout’s love of nature is most evident in his participation in the logging industry. One of Bout’s fellow arms/diamond dealers in Liberia was Leonid Menin (also spelled “Minin”), who delivered tons of arms to Liberia while operating his “Exotic Tropical Timber Enterprise” company under Charles Taylor’s protection (6).


Chichakli began rehearsing Bout's career for my benefit. He struck his first business deal in 1992, when he was 25. He bought three Antonov cargo planes for $120,000 and then brokered their services for long-haul flights from Moscow, leasing the planes both "wet" (with a crew) and "dry" (plane only). His maiden voyage was to Denmark. "I never had investors," Bout said. But where does a 25-year-old Russian get that kind of start-up money? I asked. "It was never difficult finding money," he said, refusing to say more.

In 1993, he moved his operations to the United Arab Emirates, a critical trade and transportation hinge between Asia, Africa and Europe. Newly rich Russians eager to spend their dollars had begun to flock to Dubai to shop duty-free. "They bought everything from pencils to cars to electronics to Ikea furniture," Bout said. "I saw a gap in the transport market and flew it all back for a premium." Business really started to boom when he began filling his planes with South African gladiolas. "Vic bought a day-old flower for $2 and sold it in Dubai for $100," Chichakli said. "Twenty tons per flight. It's better than printing money."

Bout made his base the emirate of Sharjah, with its notorious "airport of convenience" for planes registered in countries like the Central African Republic and Liberia. It was here that he met Chichakli, who was the founding director of Sharjah's free-trade zone. (Chichakli says he is a nephew of the former president of Syria and the son of a former Syrian under secretary of defense; he also did a stint in the U.S. Army and "trained in aviation and intelligence," he told me. He agreed that he seemed overqualified for his work as a Dallas C.P.A.)

Keep in mind that in addition to being a hub for Victor Bout’s empire, investigators also determined that the UAE’s lax-oversight made it a prime location for al-Qaeda and other Islamist militant groups to move and launder their assets via the markets in gold, diamonds, and other precious commodities.

And yes, Victor Bout’s financial accountant, Richard Chichakli, was apparently both the nephew of the former president of Syria and the son of a former Syran defense official, who then came to the US and joined military (where he claims to have had a US security clearance level of “secret”), and worked in Dallas, Texas as a C.P.A.


By 1996, Bout was running the biggest of the emirate's 160 air-cargo companies, employing 1,000 air and land crew members. "The idea was to create a network of companies in Central Africa, Southern Africa and the Emirates. I wanted to make a cargo and passenger airline like Virgin Atlantic." By 1997, Bout's operations had expanded to an abandoned airfield in Pietersburg, South Africa. He built a refrigeration facility in South Africa to freeze and store chickens, which cost a little over $1 a kilo in South Africa and sold for $10 in Nigeria. He talked openly about his early commercial exploits but was more reserved when it came to his personal life. "It's painful to have your private life exposed," he said.

He was born, the record shows, to Russian parents in Dushanbe, Tajikistan, on Jan. 13, 1967. A voracious reader of Russian classics, he attended the Soviet Military Institute for Foreign Languages in Moscow and then went to a Russian military college, earning a degree in economics. He speaks six languages fluently. (He told me he learned most of them "traveling.") He served in a military aviation regiment until 1991. Two of those years he spent in Mozambique, at the end of that country's civil war.

Bout is said to have been working for the K.G.B. in Angola when the Soviet Union dissolved in 1991. Bout insists that he never had any connection with the K.G.B. and that he had only spent a couple of weeks in Angola. "My mother cried when the newspapers connected me to the K.G.B.," he said. He was eager to show me a statement on what he said was the letterhead of the Federal Security Services -- formerly the K.G.B. -- dated October 2002. It says that the agency "has no information regarding Mr. Bout's connections with the K.G.B.," a statement that means little in a country where anything, especially a document, can be bought.

Victor Bout is also suspected of running weapons to the Angolan UNITA rebels (see section 119). Like Liberia and Sierra Leone, the economics of Angola’s civil-war has involved a great deal of “conflict diamonds” mined by the rebel groups themselves.

This includes guerrilla forces like UNITA and the RUF, which are often located in remote areas of a country without easy land access to their bases, and which are also increasingly reliant on air power to get the supplies they need to continue fighting. So it’s worth noting that Victor Bout’s fleet of large Russian cargo planes that were designed to take off and land nearly anywhere are perfectly suited for sustaining guerrilla movements.


Reflecting on his travels, Bout said he saw firsthand in Angola, Congo and elsewhere how Western donations to impoverished countries, often in the form of state-of-the-art industry, lead to the destruction of social and ecological balance, mutual resentment and eventually war. Philanthropy creates addiction, he said. "Once countries give money, they control you." He admired the isolated Pygmy tribes he visited during his jungle runs, he said, because they lived in perfect harmony with their environment, immune from conflict and diseases like AIDS.

While addictive philanthropy and Western donations to the developing world are probably not one of the great scourges of today, there may be some truth to the notion that Western loans to the corrupt regimes in the developing world have done little to help the local populace and merely indebted the country to international lenders.


He also spoke glowingly of Congo's late president, Mobutu Sese Seko, and of Ahmed Shah Massoud, the Afghan Northern Alliance commander, both of whom he said he knew intimately. He was attracted to Mobutu's common sense and Massoud's integrity. Combined, they would have made the perfect leader. They also made fine customers.

Starting in 1995, Bout expanded his air-freight operations to Ostend, Belgium, and later to Odessa, Ukraine. Eleven years earlier, Ostend had been a transit point for weapons in the Iran-contra operation, leaving behind a comfortable precedent and logistical mechanisms for arms traffickers. So did Belgium's lax arms-trafficking laws. From Sharjah and South Africa, and now from Ukraine and Ostend, Bout did indeed tap into what Africa and the Middle East needed. But it wasn't gladiolas and frozen chickens.

Oh look, Victor Bout appears to use locations that have the left over arms-trafficking networks from the Iran-Contra years. How interesting! It’s also interesting that Victor Bout’s operation in Ostend, Belgium is suspected of delivering at least 40 tons of Soviet weapons to the Taliban in 1996, so it appears his intimate relationship with Ahmed Shah Massoud did not restrict Mr. Bout from dealing with Mr Massoud’s enemies.


Most people think that controlling arms shipments is merely a matter of international diplomacy. That may have been true during the cold war, when traffickers were often subcontractors of the superpowers, feeding the proxy conflicts Washington and Moscow wanted fought. After the fall of the Berlin Wall, the exclusive club of arms brokers metastasized. Some brokers still work at the behest of governments and intelligence agencies. But most are now entrepreneurial freelancers who sell weapons without regard for ideology, allegiance or consequence. They have only one goal in mind: profit.

"Victor Bout is a creature of the Yeltsin era, of disorganized crime, who adapted to live in the era of Putin and more organized crime," according to Jonathan M. Winer, deputy assistant secretary of state for international law enforcement in the Clinton administration. In the wake of the cold war, to adapt meant to exploit the chaos. The Soviet Army's massive arsenal ended up in the hands of former Soviet republics. Desperate for hard currency, they sold off weapons the same way they sold off other resources and products they inherited from the defunct Soviet empire. "Who owned what and who ran the fire sale was a free-for-all," Winer said.

Of all the republics outside of Russia, Ukraine got the most -- and most lethal -- weapons, enough conventional firepower, by many accounts, to sustain a million troops. The Ukrainian government made a public show of transferring its vast nuclear arsenal back to Russia. But between 1992 and 1998, it has been reported, $32 billion of large- and small-scale Ukrainian weaponry and ammunition, as well as other military property, simply disappeared.

"The Ukrainian military was turned into a tool for revenue by a generation of politicians who took advantage of the factories and used them to manufacture and ship weapons for money to anyone who wanted them," Winer said. Representatives from Iraq, Iran, Somalia, Yemen, the Taliban and Pakistan came calling. So, perhaps, did North Korea, by way of Pakistan, and Al Qaeda, through the Taliban. "Whatever country has the worst governance but the best infrastructure becomes a honey pot," Winer said. "In the 1980's, it was Central America. After the fall of the Soviet Union, it became Ukraine. There's concentrated power, resources in very few hands, no oversight, no separate functioning judiciary, a huge porous border, huge inherited military facilities, lots of airstrips, a bunch of old planes. Ukraine is the epicenter for global badness. It's worse than Pakistan. It's a one-stop-shopping infrastructure for anyone who wants to buy anything." 5 Ukraine became the deepest and most reliable source of supply in the arms-trafficking underworld. What was missing was a way to move and sell the product. That's where Victor Bout and others came in. And the world was soon awash in weapons.

While it was a friendly move on Ukraine’s part to transfer their nuclear arsenal back to Russia, the presence of those nuclear weapons in Russia as opposed to Ukraine is far less reassuring than you might have hoped for.

Oh, and hopefully Pakistan won’t be trying to compete too heavily with Ukraine in the arms-proliferation area since Pakistan is currently building a weapons-grade Plutonium reactor (which US officials want to assure the public will not produce nearly as much plutonium as previously thought).


Last February, months before I met with Bout, I went to Kiev. The year before, Ukraine's president, Leonid Kuchma, had been caught personally directing illicit weapons sales. From 1998 to 2000, Kuchma's bodyguard, a former K.G.B. employee and Ukrainian intelligence officer named Mykola Melnychenko, had bugged the presidential office and then turned over tapes to an opposition member of Ukraine's Parliament. The tapes caught Kuchma apparently approving the sale of four world-class radar systems to Saddam Hussein for $100 million and ordering the director of Ukraine's intelligence agency to "take care of" a Ukrainian journalist who had been following the government's connections to illegal arms sales. Two months after that conversation, the journalist, Georgy Gongadze, vanished. His headless, acid-scorched corpse was found in a forest glade two months later. He was one of at least three Ukrainian journalists and five members of Parliament who died in the last few years under mysterious circumstances.

In 2005, it was reported that Ukraine sold nuclear-capable missiles to both Iran and China during the years of Leonid Kuchma regime (1994-2005). In September of 2006, it was reported that the same advanced Kolshuga radar systems that Ukraine sold Iraq were also sold to Iran.


Before I left for Ukraine, I met with Melnychenko, who had taken refuge in the United States. He agreed to meet me at the information booth at Grand Central Terminal, and we moved on to the bar at Michael Jordan's restaurant to talk. A pale, nervous man, he seemed an unlikely candidate to try to topple the tyrannical Ukrainian president by himself. Had anyone put him up to the bugging, I asked? He shrugged: "I'm an officer. I wanted to stop the crime." Asked if he knew Victor Bout, he at first said no, then yes and later, in a phone conversation, no again. Recently he said, "I don't know him in person, but I know a lot about him." He told me that he is frequently warned by the United States about assassination plots against him.

Whether Melnychenko worked independently or for the K.G.B. or for the C.I.A. (I was told all three), the tapes are real, and "Kuchmagate" -- as the Ukrainian press has dubbed it -- provides a glimpse of the anatomy of the arms-trafficking underworld, of which state-sponsored arms trafficking is just one thread. Arms traffickers inherited not only the Soviet Union's cold-war weapons supply but also its fully operational systems of clandestine transport, replete with money channels, people who understood how to use them and, most important, established shipping pipelines -- what Robert Gelbard, assistant secretary of state for international narcotics and law enforcement under President Clinton, calls "the tubing." "The tubing can carry different kinds of things," he told me, "drugs, humans, money -- or weapons." Victor Bout was master of the tubing.

Note how the versatility of the arms trafficking “tubing” can allow guerilla forces like the RUF and UNITA to finance themselves through drugs or diamonds or some other source of revenue, move their product out to the world’s markets, launder their profits, and move weapons and supplies back into the conflict using similar, often overlapping, trafficking networks that were, in many cases, set up for the Contra and Afghanistan support efforts.


"By 2000, Victor Bout had become the McDonald's of arms trafficking -- he was the brand name," said Alex Vines, an arms investigator for Human Rights Watch who first picked up signs of Bout's operation in 1995. A conversation with a Kenyan diamond trader and mine operator named Sanjivan Ruprah offers insight into Bout's techniques. Ruprah was arrested in Belgium in February 2002, accused of money laundering, and later released. "I met Victor to discuss airlifting a hundred tons of diamond mining equipment from South Africa to Kananga in the Congo to start a new diamond mine," Ruprah said by e-mail. (He said he was traveling in Africa, but wouldn't say in which country.) Ruprah said by e-mail. (He said he was traveling in Africa, but wouldn't say in which country.) Ruprah told U.S. investigators that in June 2002 he told Bout that the embattled Liberian president, Charles Taylor, was losing the fight for the Liberian north and asked him to arrange for an emergency delivery of weapons. In an interview with U.S. officials, Ruprah described how Bout offered to quickly fill Taylor's shopping list in exchange for a promise of future business in Liberia. Ruprah said that Bout told him he had a way around the U.N. embargo. Bout told him he had end-user certificates, required for any legal sale of weapons to a legitimate government. False certificates, which is what Bout had, can be bought from corrupt governments for as little as $50,000. Djibouti is a popular false destination; so is Peru, according to one well-known arms trafficker.

Follow Sanjivan Ruprah’s arrest and release in Belgium in February of 2002, he was arrested in Italy months later as part of an Italian/German investigation into al-Qaeda networks in Europe. It’s interesting to note that Ruprah was apparently released again since he was corresponding with the NY Times reporter for this 2003 article about M.r Bout via email while traveling in Africa.

It’s also worth noting that the fraudulent use of end-user certificates is a common tactic for trafficking of all types. It is another system of trust ripe for abuse.


Bout told me the deal simply didn't happen. "How do you think a plane can fly to Liberia, which is under U.N. embargo, without being tracked?" he said. To illustrate, Chichakli opened his laptop and started a program that charts the myriad air-traffic control centers a plane is required to contact as it flies through one country's airspace into another's. For the sake of argument, they asked me to suggest an itinerary. "From where?" Bout asked. I said Ostend, Belgium. Chichakli typed in the airport code for Ostend, OST. ''To where?'' Bout said. I suggested Monrovia, the war-ravaged capital of Liberia. Bout and Chichakli looked at each other. They hesitated. ''Monrovia, let's see,'' Chichakli said. ''Do you know the code, Victor?'' Bout shrugged, ''I have no idea.'' I watched as they tried to look as if they were struggling, typing in various permutations. Sergei finally gave them the code, ROB, for Roberts International in Monrovia.

According to this report on the the Angolan civil war, UN sanctions were regularly, often easily, overcome by Victor Bout’s organization, and that apparently continues to be the case today.


Arms traffickers use what looks like legitimate business activity to disguise the smuggling. Weapons shopping lists are quietly passed through webs of people who fill orders, often for cash on delivery. Usually, the first link in the chain is military; bribes are paid to officials and officers to look the other way, or soldiers are paid to play warehouse stock clerks. Sometimes crates of weapons are labeled perishable fruit. Or waiting air crews switch cargo at ''refueling'' stops. A pilot might fly into an airport under one registration number and fly out under a different one. Or he might start off on an openly planned flight from, say, Ostend to Peru, then double back and dogleg south to a war zone in West Africa. Payments are wired from a buyer's shell company into a seller's shell, often in money-laundering havens like the Isle of Man or the Caymans or Dubai, or money is wired to quasi-legitimate cargo companies. Sometimes weapons are simply traded for bags of cash or sockfuls of diamonds.

''Bout's procurement and logistics network is fully integrated, which made him so attractive and so successful,'' said Lee S. Wolosky, former director of transnational threats at the N.S.C. under both Clinton and Bush, who directed the U.S. campaign against Bout. ''Weaponry is harder to both get a hold of and to transport than women and drugs. There is really no one in the world who has put it all together the way he has.''

We will be looking into money-laundering, shell companies, and international financial havens much more closely in Part 10. We’ll also be taking a closer look Victor Bout’s predecessor: The Bank of Credit and Commerce International (BCCI). On top of possessing a fully integrated logistics network capable of procuring advanced weapons systems from suppliers, providing the necessary bribes and fake end-user certificates, and delivering to its clients, BCCI was also a global banking enterprise that pushed the envelope in money-laundering.

The Pakistan-based BCCI was also a major component of Pakistan’s nuclear technology procurement/profliferation network (7).

Skipping down in the article…

U.S. officials have connected Bout to both Alexander Islamov, a notorious Russian arms dealer, and Leonid Minin, a Ukrainian version of the same. I asked him if he had flown cargo for them. ''These are my clients,'' he said. ''But who cares? It's not my business to know what's on board. It's not the captain's job to open the crates and know what's inside.'' (In fact, a pilot considers it an almost religious duty to know what his plane is carrying.) Then he changed his tack, abandoning his half-hearted denial that he moved weapons. O.K., he said, the point isn't whether or not he delivers weapons; the point is, what's wrong with it? ''Illegal weapons?'' he said. ''What does that mean? If rebels control an airport and a city, and they give you clearance to land, what's illegal about that?'' After all, he said, rebels become governments, which have a right to defend themselves. What Bout didn't say was that the people receiving the weapons are often under U.N. arms embargo. Or they are rebels slaughtering their way into power.

In July of 2006, a mysterious Ilyushin-76 cargo plane landed at the Mogadishu Internaitonal Airport. It was the second plane to land there in a decade and experts believe it was loaded weapons for the Islamist militia that has taken over the capital. One has to wonder who the mystery plane owner is.



''The problem is the system,'' Bout argued. ''Arms is no different than pharmaceuticals. Actually, pharmaceuticals can be more dangerous than arms.''

Sergei was nodding in agreement. I said that coming from the mouth of a self-professed ecologist, humanist and admirer of Pygmies, that sounded at best like a cold rationalization. ''Look, killing isn't about weapons,'' Bout replied impatiently. ''It's about the humans who use them.''

Bout fell silent. His wit and his insider's perspective on international geopolitics suddenly coalesced into the cynical visage of a drug dealer peddling crack in a schoolyard. He was just a businessman selling his wares. Who was he to be the arbiter of good and evil?

On that, he was technically correct. He was different from a drug pusher in one crucial way: what he was doing might be repugnant and contributing to savagery, but it didn't necessarily make him a criminal. There is simply not a lot of law -- American, international or otherwise -- on arms trafficking. Since the mid-1990's, not one U.N. arms embargo has resulted in the conviction of an arms trafficker. The U.N. has no power to arrest. Interpol depends on the cooperation of local authorities. Astonishingly, despite having the toughest arms-trafficking laws in the world, the U.S. has not prosecuted a single case of arms trafficking. This is true partly by design. ''Governments create rules that allow arms deals to happen,'' said Lisa Misol, an arms researcher for Human Rights Watch. ''And traffickers rely on the fact that countries don't consider arms shipments originating somewhere else their problem.''

In other words, the most repugnant kind of commerce is usually not illegal. And if arms trafficking is not illegal, how can it be stopped? Why should it be stopped? When confronted by images of child soldiers in Liberia, the question seems naive, if not specious. But when it comes to weapons sales, the notion of ''national interest'' becomes a hall of mirrors. The top arms manufacturers -- and the U.S. sells more weapons than the rest of the world combined -- have a vested interest in keeping their product on the move, legally or otherwise. And aren't there also simply times when a government decides it's in its best interest, and its citizens' best interest, to let traffickers traffic? Governments are reluctant to restrain arms traffickers who might serve their own geopolitical or national-security interests in the future. ''It's the disposal problem,'' said Jonathan Winer. ''What do you do with people after you've trained them to be killers, traffickers, smugglers and criminals in the cause of a just war? Ask Manuel Noriega. He'd know.''

In 2005 the US did prosecute several arms traffickers that ended with convictions. One of those convicted was Arif Durrani, a fellow with an interesting background. In 1986 Durrani was arrested for illegally exporting Hawk anti-aircraft missile parts to Iran. Just a few weeks after his arrest, while Durrani was still sitting in jail, the Iran Contra scandal blew open with the revelation that the US sent military arms, including Hawk missiles, to Iran, via Israel, in exchange for the release of hostages in Lebanon. Durrani insisted he was working on behalf of Oliver North, but was still sentenced to five years in prison in 1987. In 1991, with the BCCI scandal unraveling, it was revealed that Durrani was quite close the the BCCI leadership, and his operations were financed by the criminal bank(8). Arif Durrani’s story highlights the importance that BCCI played in the Iran Contra arms smuggling networks, which are the predecessors and templates for today’s illegal arms trafficking.


In Africa, by all accounts, Bout sold and delivered to anyone who could pay. But Afghanistan was different. He said that he helped arm only the Rabbani government, which was then clinging to power. ''I took sides because I knew what the Taliban was,'' Bout told me. ''Rabbani and Massoud were the only hope. I had a major pact with the Rabbani government. We sustained them. My aircraft was the last one out of Bagram air base before the Taliban came.'' In the mid-1990's, he flew four shipments a day into government-controlled Jalalabad, he said: weapons (probably from the former Soviet republics) and TV's and radios from Dubai.

In August 1995, 13 months before the Taliban took Kabul, Taliban aircraft intercepted one of Bout's Sharjah-based planes loaded with ammunition for the government. The MIG's forced the plane down in the Taliban stronghold of Kandahar. What happened next has become arms-trafficking folk lore. The plane and its cargo were seized, and the crew of seven imprisoned at the airport for over a year. Eventually, the story goes, the crew members overpowered their captors, started up Bout's plane, took off under heavy fire and escaped back to Sharjah.

Bout tells a different story about the escape. He flew to Kandahar a few times over the course of that year to negotiate his crew's release, he told me, but not alone. He was accompanied by officials from the Russian government. The negotiations failed. (The story up to this point has been reported.) The reality of the plane's escape, he went on, is more interesting than the lore and more politically fraught. ''Do you really think you can jump in a plane that's been sitting unmaintained on the tarmac for over a year, start up the engines and just take off?'' He paused. ''They didn't escape. They were extracted.''

By a Western government, I asked? ''No,'' Bout said, clearly agitated. Was it a Russian government operation? At first Bout didn't answer. Then he said: ''Until now you've been digging in a big lake with small spoons. There are huge forces. . . .'' He broke off midsentence. Then he explained that this incident revealed too much about the triangulated relationship between him, governments and his rogue clients. He said he was protecting himself and me.

Before September 2001, Russia was arming Massoud and the Northern Alliance with tons of weaponry, the former N.S.C. official told me. Many of the deliveries were made by Bout. ''Bout wanted to play a more clean game, to arm the American allies,'' Johan Peleman, a U.N. arms investigator, said. Bout flatly refused to discuss any such relationship.

While Bout may have been supplying Massoud’s Northern Alliance forces until 2001, according to his Northern Alliance contact, Bout also started arming the Taliban following the “extraction” of his crew members (9). So perhaps the “huge forces” at work included some blackmail and greed. Still, getting a handle on the nature of the hidden huge forces at work in our world is quite possibly one of the most important challenges facing the public today and pales in comparison to the challenge of actually creating a world where huge forces cannot be hidden while wielding immense power over our lives.


Bout flew U.N. peacekeepers to East Timor and Somalia, and possibly to Sierra Leone. (''The U.N. always goes for the cheapest contracts,'' Peleman said.) In 1994, during the Rwandan genocide, Bout said, the French government asked him to help implement Operation Turquoise to halt the fighting and facilitate aid shipments to refugees. Bout told me that he flew in 2,500 elite French troops. He also told me that he extracted Mobutu from Congo.

''Bout is encouraged by Western intelligence agencies when it's politically expedient,'' a British arms investigator said.

The governments and rebel groups Bout supplied knew enough not to antagonize him, Gayle Smith, formerly of the N.S.C., told me. ''You wouldn't want to be on his bad side. He's wily; he's hard to catch. He was always several steps ahead. He would acquire anything and move it anywhere for anyone. While Victor Bout might be running arms to your opposition, you know he'll also ferry arms against a U.N. embargo for you.''

Bout currently works for much more than the UN. He’s also done quite a bit of work for the British and US militaries flying supplies to Iraq. One particularly disturbing incident occurred in May of 2006, when a shipment of 200,000 AK47s were to be secretly flown out of US base in Bosnian and sent to Iraq for the Iraqi security forces. The 99-ton cache of weapons disappeared. One of the airlines hired for the flight is the Moldovan-based Aerocom, which is a closely connected to Victor Bout.


In February, I went to the Ukrainian port city of Odessa to meet a pilot I was told had flown planes into Liberia for Bout. As a major transport link between Europe and the Middle East, Odessa is the central smuggling tube in Europe and a favorite port of call for pilots and traffickers of all stripes.

The pilot was waiting for me in an icy wind at the top of the Odessa steps made famous in Eisenstein's film ''Battleship Potemkin.'' We nodded to each other, and I followed him to an empty cafe. He talked in a low voice, describing how planes sometimes landed and took off amid raging gunfire. The hulls of those planes were known to often be sheathed in lead to deflect bullets. He nodded at Bout's name. He said pilots earned $10,000 per shipment. He had quit a few months before after being strafed by machine-gun fire one too many times. Half an hour after we met, the pilot led me out and brusquely said goodbye.

He had reason to be nervous. Even hard-core arms traffickers shun the country. Earlier in the year, I met with the notorious Sarkis Soghanalian in the balmy Jordanian port city of Aqaba, where he spends his days sitting by the sea before an array of satellite and cellphones. A ziggurat-shaped Armenian-American with Arafat stubble and sausage-link fingers, he is both a longtime ally of American intelligence and an occasional target of law-enforcement agencies. Soghanalian was well known for, among many other things, being Saddam Hussein's major supplier of weapons during the Iran-Iraq war years. When I asked him for advice on navigating the former Soviet Union in general and Ukraine in particular, he shook his head and said he never did business there. ''No one can be trusted. They only work for money there.''

As Saddam Hussein’s major weapons supplier in the 80’s, Sarkis Soghanalian worked closely with the US in funneling weapons to Iraq. Mr Soghanalian was convicted of conspiring to smuggle weapons into Iraq during the 82-83 Iran/Iraq war, but it appears to have gone on much longer. According to Congressional investigations, the financing of the secret arming of Saddam Hussein was done using US taxpayer-secured agricultural loans through the Atlanta branch of the Italian government-owned Banca Nazionale del Lavoro (BNL). Much of the money that flowed from BNL to Iraq was done through BCCI, and, surprise surpise, one of the individuals sitting on the board of BNL was Alfred Hartman, who was also a BCCI director (10).


A U.S. government adviser in Kiev told me, ''Odessa's an open sewer and criminal outlet.'' Eight hundred shipping containers are off-loaded at the port every day. Among other contraband like cigarettes and bootleg pharmaceuticals and CD's, weapons are smuggled in and then transferred from ship to ship or ship to plane. ''We've had a hundred seizures of radioactive material over 10 years,'' the adviser said ''But we don't know what we're getting because we don't know what we're missing.''

In one sense, Odessa is merely the gateway to a weapons source potentially even more valuable. Fifty miles up the Dniester River from Odessa, in neighboring Moldova, the breakaway province of Trans-Dniester falls under the overlapping control of Ukrainian and Russian organized crime syndicates, a Bolshevik-style administration, the Russian Army and a private corporation named Sheriff. The Russian-speaking Trans-Dniestrians fought Romanian-speaking Moldova to a stalemate in a vicious war for independence in 1992, carving out a 250-mile-long wedge of land along Moldova's border with Ukraine. Its 600,000 people are destitute and isolated.

Frozen in a state of neither war nor peace, with zero international presence or accountability, there might be no other place on earth that better represents the overlapping interests of governments, organized-crime syndicates and arms traffickers like Victor Bout. Odessa is only 50 miles of good road away. ''Trans-Dniester is patrolled by the Odessa mafia,'' Eduard Hurvitz, Odessa's former mayor, told me. The enclave is so lawless that the United States Embassy in Chisinau, Moldova's capital, discourages its personnel from going there, and staying there overnight requires the ambassador's permission.

''We're a bastard child born unofficially, but we believe we're an official state,'' Vladimir Bodnar, Trans-Dniester's minister of defense, told me. Bodnar and I were sitting in the Parliament Building in Tiraspol, Trans-Dniester's grim and sparsely populated capital. The city is peppered with valorous Soviet statuary, including a colossal monument to Lenin outside the Parliament Building. Across the street was a gas station with a sign showing an outsize five-point sheriff's badge, the logo of the Sheriff Corporation, said to be controlled by Trans-Dniester's ex-Communist president, Igor Smirnov, a former Russian factory manager. Sheriff owns many businesses in Trans-Dniester. U.S. officials have linked Russian organized-crime groups to the smuggling of radiological materials and have little doubt that the trail leads back to Trans-Dniester.

Trans-Dniester may be a bastard child of a state, but they’re the bastard child that holds the world’s largest building in the shape of a bottle. Trans-Dniester’s recently approved referendum on joining Russia no doubt excites many Russians eager to share in their glory.


Before the Soviet Union's collapse, Tiraspol was home to the Soviet 14th Army, which left behind 40,000 tons of weaponry, the largest arsenal in Europe. Russia had only begun to repatriate that weaponry by the time Trans-Dniester grabbed its quasi-independence. The lightly armed Trans-Dniestrians -- and the various criminals who controlled the territory -- refused to let the Russians leave with the remains. Or so Moscow says. Others disagree. ''The Russians could pull out tomorrow,'' said Mark Galeotti, an adviser to British intelligence on Russian organized crime. ''Smirnov is a puppet in the hand of Russian intelligence,'' said Ion Stavila, Moldova's deputy minister of foreign affairs.

At last count, stored in a complex of bunkers and berms and guarded by a skeleton crew of Russians are enough explosives to make two and a half Hiroshima bombs, tens of thousands of Kalashnikov assault rifles, millions of rounds of ammunition and huge numbers of antitank missiles, grenades and Scudlike rockets. Trans-Dniestrian factories may still produce weapons.

According to Vladimir Voronin, the president of Moldova, “there are 13 enterprises in Trans-Dniester that are producing arms non-stop”.


But Trans-Dniester is more than just the Wal-Mart of arms trafficking. Experts are concerned that terrorists -- or ambitious middlemen -- could find more sophisticated and dangerous things to buy. The Soviet military couldn't guarantee that all of the nuclear weapons had been removed. And hundreds of canisters of cesium-137, used by Soviet scientists to test the effects of nuclear war on plants, are unaccounted for. According to Russian documents I obtained, one 14th Army officer warned the Moldovans that in 1992 24 Alazan rockets in Trans-Dniester had been tipped with radioactive warheads. An adviser to British intelligence confirmed that some of the cesium is still inside Trans-Dniester.

In Moscow, over a drink, I asked Bout if he had been to Trans-Dniester. He shook his head no and shuddered. But British agents, who have tracked weapons from Trans-Dniester to the Balkans and beyond, have documented Bout's involvement there for years. ''It's clear that Ukrainian weapons Bout trafficked came through Trans-Dniester,'' Galeotti said. Not just things that have disappeared out of arsenals. Sophisticated surface-to-air missile systems to the Middle East. Vehicle-mounted and artillery systems. ''Large, high-tech kits. Flatbeds' and trainloads' worth. Bout's fingerprints are all over them.''

In July of 2006, a British lorry carry cesium-137 to Iran was stopped and impounded by Bulgarian border guards, reminding us of the fact that lawless bastard-child quasi-states are not the only places that we need to be worried about when it comes to the trafficking of nuclear materials and technology. But never fear, the world community might eventually ratify a Russian-proposed “International Convention for the Suppression of Acts of Nuclear Terrorism”, since we’re apparently still at the phase where we need to declare it a crime to have radioactive material or weapons with the intention of committing a terrorist act or to damage a nuclear facility”.


On the evening of my third day with Bout, the phone in my hotel room rang. A voice said, ''I understand we have things to talk about.'' At first I was taken aback, even amused, by the melodrama. But the voice was coldly sobering. ''Tomorrow, 1700 hours,'' the caller said. ''Go to the McDonald's on Pushkin Square. Buy two cups of coffee and sit at a table. I'll find you.'' Then he hung up.

At 5 p.m. I went to the McDonald's. It was vast, multitiered and crowded with Russian teenagers. Techno-pop was playing loudly. It was the perfect place for a private conversation.

I put two coffees on a random table and waited. At 5:02, I looked left and right into the crowd, then turned back. A man in his early 40's was in the seat across from me. ''Thank you for the coffee,'' he said.

The man didn't identify himself, but his knowledge of arms trafficking and its various players was expert. He told me that Bout was merely the public face of something much larger and that I was just getting through the surface and that to go further was very dangerous.

He alluded to two assassinations that had taken place 10 days before. Both victims were executives of a huge air-defense contractor involved in export of antiaircraft weapons and other systems.

He said to imagine the structure of arms trafficking in Russia like a mushroom. Bout was among those in the mushroom's cap, which we can see. The stalk is made up of the men who are really running things in Russia and making decisions. Looking from above, he said, you never see the stalk.

Earlier, in Kiev, Grigory Omelchenko, the former chief of Ukrainian counterintelligence, had said that traffickers like Bout are either protected or killed. ''There's total state control.''

Said E.J. Hogendoorn, the former U.N. arms investigator: ''There was the sense that there were bigger and murkier forces involved in this. Bout's being protected by highly influential people.''

I began to understand why Bout was both eager to talk and reluctant. Cornered by multiple governments, selling off his assets and hounded by the press, he wanted to complain that he had merely become the fall guy for a criminalized -- and quasi-legal -- political structure much larger and more significant than Victor Bout. But if he revealed too much, he said, he would be perilous.

In the same way that Mr. Bout’s operation is part of a larger criminalized quasi-legal political structure, it’s worth noting that in its day BCCI was also part of a much larger arms trafficking network, with the support of numerous governments including the United States, Britain, France, Saudi Arabia, the UAE and Pakistan. Operations on the scale of BCCI and Victor Bout’s simply cannot exist without the complicity of the world community.


Between the summers of 2000 and 2001, Western intelligence agencies targeted Bout with listening devices. Agents eavesdropped on his phone conversations. The stakes were raised even further in early 2001, when the N.S.C. was shown materials that led it to believe Bout had sold planes to Ariana Afghan Airlines, the national flagship airline that had been taken over by the Taliban. U.S. intelligence was reporting daily Ariana flights from the Emirates to the Taliban stronghold of Kandahar, and U.S. officials said that these aircraft may have been delivering weapons, gold and jihadis. Though there was no evidence connecting Bout to actual weapons sales to the Taliban or Al Qaeda, the U.S. government became convinced that Bout was at least servicing the planes -- enough to make him an Al Qaeda accomplice. ''What we saw led us to think that Bout had something to do with terrorism,'' Lee Wolosky told me. ''It was handled by the part of the White House associated with terrorism. There were enough indicators that set off alarm bells. The U.S. government decided to act on that basis.''

In addition to supplying the maintenance and part for Ariana airlines, Victor Bout also sold the Taliban airforce ten planes, some of which were painted to look like Ariana planes and moved weapons into Afghanistan (11).

The question was, act how? The U.S. government had no legal architecture to fight an arms network that operated across international borders in the political twilight. ''Big arms are the province of individual countries,'' Jonathan Winer said. ''But no country is configured to deal with it because its jurisdiction stops at the border.''

Said Lee S. Wolosky, the former director of transnational threats at the N.S.C.: ''Bout represented a post-cold-war phenomenon for which there was no framework to stop. No one was doing what he was doing. And there was no response. We needed to build a response.''

The N.S.C. consulted with officials in the British, South African and Belgian governments to find a way to shut Bout down and apprehend him. Intelligence agents tracked Bout's planes from Sharjah. Arms shipments were interdicted at airfields in Moldova, Slovakia and Uganda. Officials from the United Arab Emirates offered to capture Bout in Sharjah and hand him over to U.S. officials. At one point, an elite detachment was in place to make the arrest.

With Bout now under close surveillance, however, the White House made the last-minute call to pursue a classic narc strategy instead. It wanted to wait to see if Bout could take them higher up the arms-trafficking food chain.

In February 2001, the U.S. government sent a delegation to Brussels to ask prosecutors there to cooperate with their operation against Bout. The Belgians refused without explanation. Within a week of the meeting, the head of the U.S. delegation learned that Bout knew about the meeting. (Belgium did issue a warrant against Bout in February 2002, for money laundering in connection with diamonds. Bout was in Sharjah at the time, but fled to Russia before he could be apprehended.)

The February 2002 Belgian arrest warrant for Bout was issued through Interpol, which sent an alert to Moscow and obliged the Russians to arrest him. Instead, Moscow claimed he was not in Russia while, at the same time, Bout was in a two-hour interview in a local Moscow radio station protesting his innocence (12).


According to Clinton administration N.S.C. officials, from its first days the Bush administration didn't see transnational crime as a national-security issue, and it didn't share their fixation on Victor Bout. Condoleezza Rice instructed the N.S.C. to work the Bout problem diplomatically. ''Look but don't touch'' is how one former White House official put it to me.

After Sept. 11, Rice called off the Bout operation altogether. Moscow was not to be pressured on arms trafficking in general and Victor Bout in particular. The reasoning, according to a source who talked to Rice, was that they had ''bigger fish to fry.'' (Rice refused to comment for this article.)

According to European Intelligence sources, Bout made a deal with the US after 9/11: He would ship much needed supplies to the Northern Alliance, and his past activities would be forgotten (13).

Oh, and as we’re going to see in Parts 12 and 13, “look but don’t touch” is an apt way to describe the attitude of many of our top officials when it comes to counter-terrorism.

And finishing our look at this excellent NY Times article…

My last night in Moscow, Bout drove me to a restaurant outside the city that specializes in wild game. He ordered a dish of roasted vegetables. After days of discussing his life's work and the charges against him, he appeared relaxed, as though he felt he had sufficiently justified himself and set the record straight. He had done neither, or course, but he seemed relieved to have talked. After a few vodkas, he turned philosophical. ''It's easy to make war, to play the political game,'' he mused. ''But to be at peace within yourself. . . .''

After dinner, we drove down a dirt track into the woods to a walled compound. Inside was an expensive private club for banya, the traditional Russian sauna. Bout told me that when Russian men negotiate or prepare for difficult conversations, they share a banya. They are naked, and after the heat, they are defenseless and cannot hide anything. ''If you don't have a good marriage or you want that kind of thing, then you can have the girl upstairs,'' he added.

Inside the hot box it was 170 degrees. A man in a towel pounded Bout and me with eucalyptus leaves. Then we submerged in an icy dunking pool. We repeated the cycle twice more. Afterward, we sat on a couch, and he talked about literature and his admiration of the Pygmies. He spoke of Massoud, his brilliance and dependability. But he also thought Massoud was naive, and this was why he was dead. There was a television suspended in a corner showing a wildlife channel. We sat for an hour, watching animals in the African veldt hunting and devouring one another.

Sitting there naked except for a narrow strip of towel, Bout seemed the personification not of the world community's inability to stop him but of its reluctance. Bout the trafficker seemed diminished in comparison to the larger hidden system. If he was indeed the public face of arms trafficking and if he couldn't be caught, or stopped, what, I wondered, does this say about the mammoth volume of amoral transport around the world, and the huge profits at stake for individuals and governments alike?

I remembered something Richard Chichakli had said that morning: ''Victor is the most politically connected person you have ever seen, but he's not here to change the world.''

Peter Landesman writes frequently for the magazine. His last article was about mass rape in Rwanda.

No, Victor Bout does not appear to be out to change the world. And the many individuals in the much larger, hidden systems that enable Victor Bout are probably not out to change the world either. But by flooding conflicts around the globe with the most lethal weapons money can buy, they do change the world. By supplying whatever is wanted to whomever can pay for them, regardless of the consequences, men like Bout have been playing their part in ensure the 21st century will be filled with as much horror and violence for innocent people around the globe as the past century was for so many of its inhabitants.

Still, it’s important to remember that the Victor Bouts of the world are filling just one of the many roles that feed into our conflicts. The Muslim Brotherhood, Saudis, and other wealthy supporters are at work exporting violent Jihad. Often in their wake are the drugs lords and organized crime bosses that prey upon lawless war-ridden areas. And we can’t forget the many different roles governments, or elements of governments, play in fostering the conditions that lead to conflicts (and, in the case of the Ryazan bombing, possibly fomenting those conflicts). Or in the collective role that so many governments appear to play in to encouraging or tolerating the global arms trade that keeps people like Victor Bout a busy man.

And then there are the money-launderers. Without the individuals and institutions that allow over $1 trillion in dirty money to come clean annually, most major terrorist organizations would have a much harder time financing the dirty, and expensive, business of war and terror. We’ve already seen how Bank al-Taqwa in Switzerland and the SAAR network in the US both played important roles funneling charitable contributions by well-intentioned donors to a number of militant groups. Well, they had help. A lot of help. And it wasn’t even help directed towards the Muslim Brotherhood or Saudi financiers. In the same way that the international arms trafficking laws, or lack thereof, allow folks like Victor Bout to run an army of weapons through our legal loopholes at the great profit of the arms industry, interest in stopping the flow of dirty money through the world’s banks is about as great as, say, raising taxes. It’s another incredibly important topic with impact far beyond the funding of terror, so keep reading!!!!!!!!!

Offline References

(1) Dollars for Terror: The United States and Islam; by Richard Labeviere; Copyright 2000 [SC]; Algora Publishing; ISBN 1-892941-06-6; p6-9

(2) ibid p353

(3) “When Separatists Become Islamists: The Case of Chechnya” Julie Wilhelsen. FORSVARETS FORSKNINGSINSTITUTT February 2004, p41-42

(4) “Saga of Dr. Zawahri Sheds Light On the Roots of al Qaeda Terror” By ANDREW HIGGINS and ALAN CULLISON; Wall Street Journal; July 2, 2002

(5) Blood from Stones: The Secret Financial Network of Terror; by Douglas Farah; Broadway Books [HC] {subsidiary of Random House}; Copyright 2004 by Douglas Farah; ISBN 0-7679-15262-3; p39

(6) ibid p45

(7) The Outlaw Bank: a Wild Ride Into the Secret Heart of BCCI, by Jonathan Beaty & S.C. Gwynne; Beard Books; Copyright 1993; ISBN 1-58798-146-7; p290

(8) Ibid p268

(9) Blood from Stones: The Secret Financial Network of Terror; by Douglas Farah; Broadway Books [HC] {subsidiary of Random House}; Copyright 2004 by Douglas Farah; ISBN 0-7679-15262-3; p42

(10) The Outlaw Bank: a Wild Ride Into the Secret Heart of BCCI, by Jonathan Beaty & S.C. Gwynne; Beard Books; Copyright 1993; ISBN 1-58798-146-7; p311-312

(11) Blood from Stones: The Secret Financial Network of Terror; by Douglas Farah; Broadway Books [HC] {subsidiary of Random House}; Copyright 2004 by Douglas Farah; ISBN 0-7679-15262-3; p42

(12) ibid p43-44

(13) ibid p44-45